The Franchisees Association of Australia has welcomed the controversial Small Business Commissioner Bill in South Australia. David Beddall, president of the FAA, said “It seems extraordinary, but this new Bill is the first time there any potential penalties for breaches of prescribed Codes of Conduct.  Codes which have no penalties may as well not exist.  If you are a small franchisee, you are powerless to take on a franchisor in the expensive Court system. This Bill is a ‘win win’ for the whole industry.”

The South Australian legislation was opposed by the Franchise Council of Australia, concerned that state level franchise regulation would be introduced through the back-door. The FCA believes in national regulation.

“The FAA agrees with this principle and has always had it as our longer term goal. However, in the absence of any Federal initiatives, any State-based legislation is most welcome. We have to start somewhere, rather than go on ignoring the distress of many franchisees caught up in a web of unfair practices by some, but not all franchisors” said Beddall.

Frank Zumbo is an associate professor in Business Law at the University of New South Wales who assisted the South Australian Government in developing the legislation. Zumbo said the SA Small Business Commissioner reforms are set to usher in a new era of confidence amongst South Australian small businesses.

"The SA Small Business Commissioner will provide a cost effective alternative to litigation and assist small businesses in seeking to maintain an ongoing dialogue with larger businesses in the event of a dispute. The SA Small Business Commissioner will play a vital role in promoting better decision making by the State’s small businesses, as well as providing a vital dispute resolution role."

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